Today on Morning Joe, MSNBC’s Lawrence O’Donnell said, “Remember what supply-side economics is. It is the promise that by cutting taxes, the treasury is going to collect more revenue because the economy will be so wildly stimulated by cutting taxes...But by cutting these taxes the treasury is going to collect less money.”
Mr. O’Donnell’s remarks may be the most honest, realistic words ever spoken about tax cut policy. According to the New York Times, "he tax benefits will flow most heavily to the highest earners, just as the original cuts did when they were passed in 2001 and 2003. At least a quarter of the tax savings will go to the wealthiest 1 percent of the population."
A UPI report said there is no evidence that shows supply side economics trickles down to anyone. Additional reports on MSNBC support that data. Essentially, when the wealthy get money they save it, when the middle class and poor get money they spend it. Therefore, the basis for the republican argument that tax cuts for the rich will create jobs has no substance. The republican tax deal will force and additional $900 billion dollars in debt on 100% of the American people, yet it will benefit only 2%.
At a recent press conference, President Obama said that the battle over the deficit and tax policy is a long term endeavor. According to the New York Times, the Obama Administration is considering an overhaul of allowable tax deductions that would raise revenue by closing loopholes. “The objective is to rid the code of its complex buildup of deductions, credits and exemptions, thereby broadening the base of taxes collected and allowing for lower rates.”
How far President Obama will get with an uncooperative republican leadership is unclear. However if lawmakers on both side of the isle are committed to reducing the deficit, the logical place to begin is to reform the tax code.
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